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I keep writing about the Federal Reserve’s impact on equities because in my opinion they are the sole source driving the markets. The Fed’s easy money policy has so depressed interest rates for so long that the distortions have been felt globally.

The current market downtrend, like the others this year, is due to trader’s fixation on whether the Fed will taper Quantitative Easing next week.

My speculation is that the Fed won’t taper next week, or if they do it will be a token $5-10 billion. In any case, the Fed will keep the discount rate near zero and do their best to moderate short and long term rates.

We’ll all just have to wait and see how the drama unfolds and what impact it has on the global markets.